SEC Drops Lawsuit Against Binance in Landmark Decision

The U.S. Securities and Exchange Commission (SEC) has officially dismissed its lawsuit against crypto exchange Binance.

This puts an end to one of its most high-profile enforcement actions in the crypto space.

Joint Dismissal Motion

“Huge win for crypto today. The SEC’s case against us is dismissed,” Binance revealed in a May 30 X post. The company also thanked SEC Chairman Paul Atkins and President Trump’s team “for pushing back against regulation by enforcement,” adding, “U.S. innovation is back on track – and it’s just the beginning.”

The dismissal follows a joint motion filed on May 29 by the SEC, Binance, and ex-CEO Changpeng Zhao. The petition, submitted to a federal court in Washington, D.C., requested that the agency’s original complaint be dropped.

The regulator stated that dropping the case was appropriate “in the exercise of its discretion and as a policy matter,” and clarified that the decision does not reflect its views on other cryptocurrency-related litigation. The lawsuit was also dissolved with prejudice, meaning it cannot be reopened.

This ruling comes after the lawsuit was paused twice earlier this year, in February and April. The SEC’s Crypto Task Force, created under Acting Chair Mark T. Uyeda, played a key role in the decision to move forward with the action.

The financial watchdog first sued Binance, Zhao, and its U.S.-based arm in June 2023. The lawsuit accused them of violating securities laws by offering unregistered securities to U.S. investors, mishandling customer funds, and misleading investors. The agency also claimed the exchange had failed to put in place proper financial controls.

It was the last major regulator still pursuing Binance after a $4.3 billion settlement with the U.S. government last year, in which Zhao pleaded guilty and stepped down as CEO.

A Changed Approach

The SEC has been reversing its approach to crypto regulation under President Donald Trump’s second administration. The development is the latest in a string of enforcement actions that the agency has since dropped.

In earlier months, it abandoned or settled complaints against Coinbase, Ripple, and Kraken. Additionally, the agency closed its investigations into Robinhood Crypto, Uniswap Labs, and OpenSea.

Paul Atkins has since taken over as SEC Chairman, bringing a pro-crypto stance and a commitment to create a framework for digital assets. Under his and Uyeda’s leadership, the regulator has held several roundtables focused on crypto regulation and financial innovation, with Commissioner Hester Peirce playing a key role in these discussions.

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